SANDERS’ MARK MISSING FROM TOURISM PACT

Former mayor did not sign key contract before leaving office

The showdown between San Diego’s hotel industry and Mayor Bob Filner over millions of dollars in tourism marketing funds would never have happened had former Mayor Jerry Sanders simply signed a key contract before leaving office in early December.

That document, needed before a dime of the money can be spent, spells out how San Diego’s hotelier-run Tourism Marketing District is to be operated on behalf of the city.

Sanders’ failure to sign the agreement ultimately set the stage for Filner to try to use the unsigned pact as leverage for extracting financial concessions from the city’s hoteliers, who have control over how the money is spent to promote San Diego.

How it is that Sanders never signed the contract is not clear, with political finger pointing and confusion being more common than answers. Sanders is on an extended vacation in Italy and could not be reached.

One likely scenario is that the document was held up in the city’s Purchasing and Contracting Department, even though it had been completed by the City Attorney’s Office and already had the required signature of the board chairman of the tourism marketing corporation.

“We wanted to get everything signed that we could,” said Julie Dubick, Sanders’ then chief of staff, describing the waning days of the administration. “We made requests from all parties and entities to get us documents that should be signed...

“There were no outstanding requests for signatures when Sanders’ term ended. Perhaps this was believed to be pro forma and not a rush.”

Whatever the reason for the oversight, the agreement sits in Filner’s office, unsigned, awaiting the outcome of a court ruling later this month on whether the new mayor can be legally compelled to sign the pact by order of the City Council.

Filner has said he can broker a much better deal for the city, which he said deserves more than the $30 million a year the district is expected to generate via a 2 percent surcharge on hotel room rates. He is also pushing hotel owners to guarantee their workers higher wages and better benefits.

In the meantime, the city’s tourism bureau has canceled a $5 million summer advertising campaign, and its staff faces layoffs if funding doesn’t materialize by April.

Sanders’ former spokesman, Darren Pudgil, said it’s unrealistic to think his administration could have foreseen the turn of events and prevented them by getting that signature.

“There’s no way anyone could have predicted Mayor Filner would have held up this funding,” Pudgil said. “Unfortunately, we don’t have a crystal ball.”

It was no secret, though, that Filner, during his mayoral campaign, had raised concerns about the legality of the hotel levy being assessed by the Tourism Marketing District, which he felt should contribute some of its revenues for public safety uses.

The city’s hoteliers and tourism leaders said they were taken aback to learn in January that the contract was unsigned, assuming the documents needed to transition from the old marketing district to the new one were completed after the City Council approved the renewal in November.

“It was totally unanticipated that the agreement wouldn’t be signed,” said Lorin Stewart, executive director of the district. “It’s safe to say we all believed it had been signed. That’s because we got the signed resolutions and felt that because they were all passed at the same time that the agreement had been signed as well.

“We’re not in control of the routing system at the city.”

Namara Mercer, executive director of the San Diego County Hotel-Motel Association, agreed that hoteliers should not be expected to understand the inner workings of City Hall procedures.

“Once this process goes through the city, that’s not within the purview of the average hotel operator to know where these contracts are going,” she said. “I don’t know that any of us have ever questioned the city on following through on a contract.”

Sanders had signed the required council resolutions to renew the tourism marketing operation, starting Jan. 1, but not the actual five-year agreement for the day-to-day operation of the district and disbursement of moneys collected from the hotels.

Dubick suggested that if the operating agreement was indeed a critical legal document, it would have fallen to City Attorney Jan Goldsmith’s office to ensure it was signed.

“The city attorney neither required nor gave any notice that the operating agreement needed to be signed before Sanders left office, as Goldsmith could have done even if it went to Purchasing and Contracting initially,” she said. “If it legally was needed and is not just ministerial, then Jan should have made that known as he often gave opinions on completing documents and what was necessary in his opinion.”

Goldsmith said the agreement was finalized by his office as early as Nov. 7 and once the council on Nov. 26 approved the renewal of the tourism district, it was ready for Sanders.

“Our understanding is that Mayor Sanders signed the resolution just after Nov. 26, but did not sign the contract,” Goldsmith said. “There is no legal reason the mayor could not have also signed the contract when he signed the resolution or shortly thereafter.”

Assistant City Attorney Mary Lanzafame routed questions back to the Mayor’s Office.

“We have heard that it was with the Purchasing and Contracting Department and didn’t get to the mayor’s desk for signature,” she said. “However, we can’t answer that as it is the executive branch that handles these matters of process.”

The city’s Development Services Department did some of the work of shepherding the tourism marketing issue through the approval process last year. A spokeswoman said on Friday that she prepared a draft response to the Watchdog’s questions about what became of the unsigned contract and was awaiting approval from Filner’s office, which did not respond.

The city’s former chief operating officer, Jay Goldstone, who was authorized to sign contracts on Sanders’ behalf, could have signed the operating agreement and in fact did so in 2008 when the tourism district was first established. He did not respond to inquiries for this story.